Here’s exactly what I think of the current real estate market, how to invest in real estate in 2019, and whether or not prices might go down - enjoy! Add me on Instagram: GPStephan
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Welcome to an article I just read by The Balance…in it, they say:
A survey found that 58% of people felt like there would be a housing correction by 2020, and as a result, 83% feel like it would be a good time to sell.
Then article goes further to explain that:
“National median family home prices are 32% higher than inflation, similar to 2005, when they were 35% overvalued.”
And…yes…even more spooky statistics…”52% of home loans are now originated by lenders who aren’t regulated as banks.”
However, after reading through all of their data… there should really be a few main takeaways in terms of when and how the real estate market will drop…and how you can make sure you come out of it PROFITABLE:
First, it’s REALLY important to understand that when it comes to real estate, it is entirely about LOCATION, LOCATION, LOCATION.
It is IMPOSSIBLE to say that the ENTIRE real estate market will drop at the same time…that’s like saying ALL stocks will come drop down, without recognizing that some stocks may end up doing incredibly well. Real Estate is the exact same way. Real estate prices are heavily influenced by specific market conditions of demand, proximity to employment, and current supply of inventory…this will vary DRAMATICALLY from Location to Location.
Second, in terms of housing PRICES themselves - it’s important to distinguish that MANY real estate markets STILL have not recovered from their previous all time highs once you account for inflation.
https://seekingalpha.com/article/4097882-definitely-housing-bubble
Prices just naturally rise over time, and as markets continue to develop, we’re going to constantly be reaching all time highs…that doesn’t mean it’s necessarily over valued. Same applies to the stock market, we’re going to naturally continue hitting all time highs…and that isn’t a reason NOT to buy a home. It’s just a normal cycle where prices will continually get more expensive over time.
Third, a MAJOR point the article missed is that for most people, the value of their home isn’t going to really make much of a difference in the short term:
For EVERYONE who’s buying a home with the intention to live in it for 10 years or more, then price it’s worth within the next few years makes absolutely no difference whatsoever, when you aren’t selling. I think that’s the most difficult part for people to understand, because EVERYONE thinks to themselves: I want to wait for prices to drop first, THEN I can buy something!!
Instead, anytime you’re buying real estate, the #1 thing you can do is buy with the intention of holding it long term.
Secondly, and this is common sense, but you’d be surprised…only buy something that you can comfortably afford on a fixed payment.
Third, do your best to buy a property under market value.
And fourth…if you’re buying something as an INVESTMENT where you plan to make money from it…CASHFLOW IS KING, not necessarily the value of the property in relation to what you paid.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
Second Channel: https://www.youtube.com/channel/UCa-ckhlKL98F8YXKQ-BALiw
The YouTube Creator Academy:
Learn EXACTLY how to get your first 1000 subscribers on YouTube, rank videos on the front page of searches, grow your following, and turn that into another income source: https://bit.ly/2STxofv $100 OFF WITH CODE 100OFF
Get 2 Free Stocks on WeBull when you deposit $100 (Valued up to $1000): https://act.webull.com/k/Vowbik9Tm5he/main
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
Welcome to an article I just read by The Balance…in it, they say:
A survey found that 58% of people felt like there would be a housing correction by 2020, and as a result, 83% feel like it would be a good time to sell.
Then article goes further to explain that:
“National median family home prices are 32% higher than inflation, similar to 2005, when they were 35% overvalued.”
And…yes…even more spooky statistics…”52% of home loans are now originated by lenders who aren’t regulated as banks.”
However, after reading through all of their data… there should really be a few main takeaways in terms of when and how the real estate market will drop…and how you can make sure you come out of it PROFITABLE:
First, it’s REALLY important to understand that when it comes to real estate, it is entirely about LOCATION, LOCATION, LOCATION.
It is IMPOSSIBLE to say that the ENTIRE real estate market will drop at the same time…that’s like saying ALL stocks will come drop down, without recognizing that some stocks may end up doing incredibly well. Real Estate is the exact same way. Real estate prices are heavily influenced by specific market conditions of demand, proximity to employment, and current supply of inventory…this will vary DRAMATICALLY from Location to Location.
Second, in terms of housing PRICES themselves - it’s important to distinguish that MANY real estate markets STILL have not recovered from their previous all time highs once you account for inflation.
https://seekingalpha.com/article/4097882-definitely-housing-bubble
Prices just naturally rise over time, and as markets continue to develop, we’re going to constantly be reaching all time highs…that doesn’t mean it’s necessarily over valued. Same applies to the stock market, we’re going to naturally continue hitting all time highs…and that isn’t a reason NOT to buy a home. It’s just a normal cycle where prices will continually get more expensive over time.
Third, a MAJOR point the article missed is that for most people, the value of their home isn’t going to really make much of a difference in the short term:
For EVERYONE who’s buying a home with the intention to live in it for 10 years or more, then price it’s worth within the next few years makes absolutely no difference whatsoever, when you aren’t selling. I think that’s the most difficult part for people to understand, because EVERYONE thinks to themselves: I want to wait for prices to drop first, THEN I can buy something!!
Instead, anytime you’re buying real estate, the #1 thing you can do is buy with the intention of holding it long term.
Secondly, and this is common sense, but you’d be surprised…only buy something that you can comfortably afford on a fixed payment.
Third, do your best to buy a property under market value.
And fourth…if you’re buying something as an INVESTMENT where you plan to make money from it…CASHFLOW IS KING, not necessarily the value of the property in relation to what you paid.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
Number of new houses sold in the USA in 2005 was 1.2 million units in 2019 600.000. This is an enormous drop in HALF !!!. That explains everything how demand is shrinking and the market becomes oversupplied and poor. We are slowly running out of buyers. If you sitting on several units. Sell it as fast as you can. Because its a near-future when your unit will have no value at all and will become a place for bumps and junkies! And forget about a long time rentals there comming a tough competition to such level that it's ok if you only pay expenses bills . 2 years ago there was a farm good location lest saying the price was 50 last year we almost bought at 40, this year I asked my friedn to call and test with an offer 35 seller agree. … I will get it at 15-20 next year I bet 1 dollar!! Let's say is outside not many possibilities there the town is 15 miles, but it's only 15 miles, and no buyer so far. But it's not the point the point is I am the cheaf in the position, not the seller. Dubai's real estate crumbles to such a level that they go looking for any business phone numbers and dare to bother you in hope? Can you imagine that?
So what's going on here? No demand -market oversupplied and it's getting poorer and poorer. Everybody just lives in the illusion that they will sell at high rice, but like there is no buyer so there is no buyer. And now lots people will need money soon. ! can go out walking around and will count 20 houses and 50 apartments for sale, I am counting the same house already several years. An Airbnb debt scam is over as well. These 4 million units or more that banks own soon gonna hit the market as well in major cities. That's why Airbnb was launched in the first place with a trillion project in creating dept around the world with an investment of a webpage.
fixed price removed on most of the ads and become a price for negotiating. A real state agent in a 3 million city sold this year 0 almost. And is just a warm-up of our silly events. Go out rise your head and start counted hanging ads in your area and get the picture. Then look around who you know and think who of them will need real estate or planning in near future and you will find none in most cases. Fourclouses waves already started -name your price, join the auction, take it we don't need it. It cost nothing for us. The point is one soul is busted and under the bridge -the rest is not important, we gave papers we didn't have and now we have what was build with sweat and bricks.
This has nothing to do with 1933 or 2008 this is 2020, you have been told a new normal. Not enough for you to connect the dots?
or you thought a new normal will be just a sanitary pad on your face ?
This is the worse time to invest in any property, with the loan or without it if you do not see that upcoming a huge population reduction then you don't see anything in this world-blind and def
Soon there will be an abundance in real estate, the shortage of real estate is a huge myth by real estate agents. No matter where you go its pa ked with offers.
I estimate that by 2030 the prices of real estate will be more than 50% off of today's value. And that proves why gold is skyrocketing, those who know they do not invest any more in any real estate unless they grab quick dollars on it. No one is would spend money on pointless gold when you can invest what people really need,
So sell your investment if you can, not quite sure what to do with the money, open funeral service maybe. Because all your house value is now stating go down and down and doooooown
55% of house owners are senior citizens, a prime target means 55% of real estate coming to the market within 2-3 years. Now let's look at who are the buyers? A new generation of autistic teens? I can assure you that they need games at the age of 35, not real estate. Airbnb guys :DDDI? An imported foreigner? I dotn think that he will get a chance to make enough bucks to afford it
people will literally fight like a tigers over the buyer with the words- f. it so tell me how much you can pay…pleeeeaasseeee.
And the buyer will say, sorry i changed my mind decided to get that penthouse I just heard he is dying as well.
I received a transfer of $54,000 directly to my bank account all thanks to expeditetools,com .
As a person that lives in Boise, Idaho
I felt that… 15% increase.
well , sounds like they were on to something
Wow just starting off the video and you want to tell us what you have no one cares
Homes in many if not most areas were way above a historical level compared to wages. FHA was 3.5% down and that could be a gift or grant so effectively no down. The buyer didn't have to have reserves left over. The DTI was up to 55% of gross income, not net. That is just stupid and stupid should hurt! Let prices match incomes in a free market and young people will pick up those homes and start stable families, possibly one parent could raise the family or work part time from home. The housing market is way too manipulated. Tell congress to let housing find equilibrium, no bailouts of overextended owners, banks or gov entities such as FHA, Fannie or Freddie! Stop making young people debt slaves!!!!!!
Real estate is heavily inflated
You need to do a new one 🙏
Hi Graham, just curious. Does a recession always cause a housing market crash? I’m currently making offer on properties because the interest rates have come down a lot, but I’m scared that with the recent news the housing market might go down. However I remember back in 2008 the falling prices on properties was actually the reason why the recession happened, since then the housing market has become more stable with less risky loans. What are your thoughts.
I'm not buying now because homes are 3 times overpriced.
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I have a question! So i am in College and i am allowed too take out 50000 in loans. I took out 10500. To buy a house by November. I was debating on putting it on a cd for 6 months. Buying something and double the amount even a little. Im in Colorado where housing is very expensive. 1200$ Rent every month. I want to buy a 180 to 200 000 $ home by november. I plan to house hack. I also found 2 homes in my hometown for 10,000. To 20,000 each . i plan to take that out of my loan for the home in colorado. To profit off those over the years . i would make my money back for 1 of those Oklahoma homes within the first year and the 2nd the 2nd home. Is this a good idea of some sort or am i blind sided. Needing some advice. I also have no debts and a 730 credit score. I came from a 450 in the last 2 years.
There is a subdivision about a mile from me that has been developed for 3 years it has exactly 17 houses in the area. But it is completely empty. The skater kids are now hanging out there on the weekends. Nice looking properties some 2 car garages.
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if housing prices go down, interest rates usually go up, so its not always more affordable.
When its the right time, how do I buy real estate when my income is at poverty level? My spending is like your's… I don't buy stuff that I don't absolutely need.
Nobody has a crystal ball. That's why it's important as an investor to really know the numbers and to ALWAYS err on the side of caution and underwrite conservatively.
Your argument about the tax law effect on home owners is weak, because it fails to see the biggest impact of the new tax law. Previously the standard deduction for a family was 12K and you could easily beat this number with itemized deductions when you had a home. However with the new law the standard deduction is 24K and if all taxes deductions are capped at 10K that means that your mortgage interest should be 14K just to match the standard deduction, your real tax benefit comes when your mortgage interest is above $14K annually, which would mean your loan balance can be at 350,000 and at 4% interest you would still have no tax benefit and a 350K loan indicates a home value of well, well above the national median. So the tax breaks for home owners as of now are unusable for a vast majority of families.
Breaking News: Guy who sells real estate for a living wants you to think it'll never crash and even if it might, you should still buy it.
Wow it seemed as though all the words out of your mouth are all the things I follow for my own real estate investing!! My dad is a smart developer though and he taught me well haha!
What happens to rents and vacancies during recessions?
I bought a house in San Diego for below market value. The only reason I was able to do this, is because part of the deal was a 'fast escrow'. The previous owner had already purchased their other house and was accepting an offer that would allow her to move out ASAP.
Real estate prices never fall before elections .. growth is the only vote getter for politicians and they donT care much for inflation but if the growth and job rates drop they are not elected again they willl do all they can to pump growht before election..What tools they have government spending, if nothing else works like if FED does't drop interest rates when asked etc. So you dont have to worry in 2021 🙂
I can't wait for this bubble to pop. I'll have to move if it doesn't. Houses on market in my hometown are insane. Half acre lots with nothing on them are pushing 200k. A old 2&2 that needs remodeling are pushing 500k. GTFOH! Income inequality is on the horizon. The COL is getting so high along with the housing market. I don't see how the affluent people will have anyone to make their lattes and service their infilstructure be able to afford to live anywhere near them. I know I'm not commuting 2 hours one way to work for peanuts and be treated like a 3rd class citizen. The rich can just pay each other.
I can't lock a 30 yr mortgage on a 6 unit mixed commercial property… did you guys know this?
Who knows? Real estate prices in CA might never come down for the next ten years, because the very worst of the foreclosure crises has been over for over ten years.
My grand parents lived through the depression, they said the only people who were well off were the people who OWNED there rental properties.
The lowest home loan I ever had was 7.5 percent…the highest…14.5!!!
When housing prices collapse it's always the usual suspects. California.. Florida Texas Colorado and others…most of the country doesn't go speculation crazy. Never did in my home state…
I live in Los Angeles and I'm currently planning on buying a home for about $350,000 somewhere in an area where many people have iron bars on their windows, there are of course risks associated with a downturn and I'm not a stranger to the crash because I started working in real estate when prices were going down and the agent I was working with was calling her clients asking for $50,000 price reductions on million-dollar properties.
Homeownership makes sense to me for several reasons in the long run, one because I want to control my cost-of-living and rents are always going up, 2 because I have construction experience and I plan on putting Sweat Equity into the home, 3 because I'm single with no kids should I lose my job I can sleep in a tent or a shed in the backyard while renting out my property.
Although the bubble that were in is concerning you also have to consider supply and demand, there are not a ton of new homes being built in Los Angeles and because of the halo effect California has on people that aren't familiar with how f**** expensive it is to live here there will always be people trying to move to California to make their dreams come true and we'll always need somewhere to rent
Misleading vid encouraging people to buy at the peak as though the price “does not matter”. Must suck to be a thirsty realtor during this market.